In the German Savings and Loan Society v. Dormitzer case of 1903, the U.S Supreme Court ruled in favor of German Savings and Loan Society. The dispute arose when a debtor, Mr. Dormitzer, declared bankruptcy after borrowing money from the plaintiff using his property as collateral security for repayment of debt. After declaring bankruptcy, he sold this property to another party without informing or paying back his creditor (German Savings). When German Savings learned about this transaction they sued both parties involved - Mr.Dormitzer and the new owner - claiming their right over that property until their loan was repaid by Mr.Dormitzer. The court held that under California law at that time (where this incident occurred), once a borrower declares bankruptcy it does not automatically terminate all rights of creditors who have secured loans with collaterals like properties etc., unless explicitly stated otherwise in Bankruptcy Act itself which wasn't there then. Therefore, even though Mr.Dormitizer had declared himself bankrupt he still owed his debts to German Saving until they were fully paid off irrespective whether he owned any assets or not afterwards.

In the dissenting opinion for German Savings and Loan Society v. Dormitzer, it was argued that the majority's decision to uphold a lower court ruling in favor of the plaintiff contradicted established legal principles regarding contract law. The dissent contended that there was no valid reason to set aside an agreement made between two parties simply because one party later found it inconvenient or disadvantageous. It further asserted that if such contracts were not upheld, then all business transactions would be subject to uncertainty and instability as any party could potentially renege on their obligations without consequence. Thus, according to this view, upholding contractual agreements is essential for maintaining order and predictability in commercial relations.